Total Took 10% Stake in Refinery

Total Took 10% Stake in Refinery

The Ugandan Energy Minister, Irene Muloni, stated that Total SA, the French oil company drilling wells in Uganda, agreed to take a 10% stake in the country’s planned refinery as it seeks other investors for the $4b plant, Bloomberg reported.

The proposed 60,000b/d refinery will be supplied by oil fields discovered in Uganda in 2006 and estimated by the state to hold 6.5b barrels of crude resources. Total is developing the fields in a venture with UK’s Tullow Oil Plc and China’s CNOOC. Uganda is reserving 60% of the facility for private investors, while the remaining 40% has been set aside for governments of the six-nation East African Community (EAC), informed Ecofin Agency.

Tanzania agreed to take the 8% stake it was offered, while Kenya plans to take up only 2.5%. State-owned Kenya Pipeline Company is considering refurbishing a mothballed refinery in the coastal city of Mombasa that may process the country’s future oil production. Muloni said: “whatever will remain untaken, the government of Uganda will take,” she said. Other EAC nations include Rwanda, Burundi and South Sudan.

Uganda had pushed the completion of the first phase of the project to 2020 from 2018 due to failed negotiations with a group of investors led by Russia’s RT GlobalResources LLC on the construction of the refinery. Accordingly, this forced the government to engage with other potential investors. Muloni added: “The process with RT Global ended because they brought impossible conditions which were unfavorable to our government and now we are engaging other companies that are interested in the refinery.”

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